Poor farmers in Ayeyawady Delta see dawn of better life

Daw Ohn Myint Kyi nurtures betel plants at her farm established with the use of loans from the Pact Global Microfinance Fund.—Photo: Aye Min Soe
Daw Ohn Myint Kyi nurtures betel plants at her farm established with the use of loans from the Pact Global Microfinance Fund.—Photo: Aye Min Soe

Kyee Chaung (Ayeyawady Delta), 26 Jan — Poor farmers from Kyee Chaung Village in Bogale Township in the Ayeyawady Delta who suffered from under the onslaught of Cyclone Nargis more than six years ago may have found a silver lining freeing themselves from the poverty trap.
“I want to borrow 450,000 kyat to grow a further 300 betel plants,” Daw Ohn Myint Kyi, 57, told a loan officer of Pact Global Microfinance Fund (PGMF) as she stood alongside the four other members of her lending group.
About 50 other women at the meeting of the members of the fund unanimously agreed to grant the proposed loan to Daw Ohn Myint Kyi when the loan officer sought agreements from them in three votes.
Daw Ohn Myint Kyi guaranteed the loan officer that she would pay back K27,000 every two weeks to the fund until she settles the agricultural loan
in a year.
It means she agreed to borrow money to do business from the fund with an interest rate of 2.5 per cent a month or 30 per cent
a year.
The interest rate for social affairs loans is 2 per cent per month from the fund, which is very low compared to the interest rate they paid to private money lenders, according to local farmers. While some well-to-do families and those who were mostly unaffected by Nargis can avoid borrowing from the fund, 52 women from the 124 households in Kyee Chaung Village have registered as members of the microfinance fund and they are divided in groups comprising five to six members so they can guarantee each other when a member borrows money from the fund in accordance with fund rules.
According to the fund, out of 585 villages in 86 village-tracts in rural areas, and 10 wards in urban in Bogale in the Ayeyawady Delta, credit components of the fund have reached to 429 villages, attracting 33,086 clients and 18,132 active borrowers.
So far, the fund has already loaned more than K10 million to women in the village of Kyee Chaung, said Khaing Khaing Oo, a loan officer for the fund.
PGMF is supported by the multi-donor Livelihoods and Food Security Trust Fund (LIFT), which works in Myanmar to alleviate poverty and hunger.
Before and after Nargis, the villagers, including Daw Ohn Myint Kyi, had no ways to do business as they had no capital and were burdened with debt.
When the rice harvest is low due to disease and pests, the rice their farmland is barely enough to pay back agricultural loans to the government, causing them to get into debt for ordinary living.

When villagers understand how to value loans and their businesses for getting out of poverty, they are ready to receive loans from the Pact Global Microfinance Fund.—Photo: Aye Min Soe
When villagers understand how to value loans and their businesses for getting out of poverty, they are ready to receive loans from the Pact Global Microfinance Fund.—Photo: Aye Min Soe

Even in years of good harvests, there is no certainty they will get a good price for their rice.
To feed their families and to start planting rice for the next season, they had to borrow money from private lenders at 8 to 10 per cent interest per month.
One year after Nargis, Daw Ohn Myit Kyi borrowed K70,000 from the microfinance fund for the first time and farmed pigs as a side job while her family was working paddy on their three acres of rain-fed rice fields.
As she kept her guarantee to the fund, the amount of money she is entitled to borrow from the fund has increased year by year, reaching K400,000 this year.
After struggling for three or four years, she tackled her debts with high interest rates owed to private money lenders and was able to send her three children to school until they completed their high school education.
“I can pay 27,000 kyat every 14 days to the (PGMF),” says Daw Ohn Myint Kyi with confidence, “because I have 500 betel plants and other vegetable plantations and I have earned 5,000 to 6,000 kyat every three days.”
Besides, she will earn income from her new betel plants every 15 days once they are mature.
Like Daw Ohn Myint Kyi, other women from the village have also gained benefits from the microcredit scheme.
Daw Ei Khin, 45, is farming 100 ducks while planting rice in her family-owned rain-fed eight acre field. She borrowed K300,000 from the (PGMF) last year to raise ducks and to establish vegetable plots.
However, some households, including families of old couples who have no women, cannot borrow money from the fund because the fund loans only to women because women have earned the trust of the fund, she added.
The microfinance design for agricultural and livestock loans of the Pact Global Microfinance Fund has given priorities to women because it is a majority of women who can participate in microfinance meetings during day while their husbands are working the farmland, according to the PGMF.
“However, men are not excluded,” said U Myint Kyaw, LIFT’s Microfinance and Business Development Officer. “PGMF provides microfinance services in villages where other NGOs are implementing development projects with LIFT funding. Among those villages, men’s membership in microfinance is around 2.3 %,” he added.
PGMF has also given social loans and loans to vulnerable households with very low interest rates. In addition, it has set up a fund for beneficiary welfare that provides lump sum compensation for economic loss resulting from natural disaster, and client death benefits, he added. To qualify for loans from the fund, members have to participate in the non-formal business education programme of PGMF to learn about business, including profit, loss, weaknesses and strengths of the small businesses that relates to both agriculture and non agriculture.
“We are out of debt. We don’t need to borrow money with high interest rates from private lenders. We have no worries for our future,” said Daw Ei Khin. — GNLM

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